Objectives and Key Results (OKRs for short) are changing how companies define and communicate success. Why not have a read through our free beginners guide to OKRs to get more information on how you can align and grow your company.
So there you are, working on your first set of Objective & Key Results (OKRs) for the business. Great! But how do you know you are pitching them at the right level? How do you know you’re striking the balance between challenge, growth and achievement? Can you, your business and your team achieve success without getting burnt out?
It’s no surprise that this is one of the questions I get asked when helping a client design their first set of OKRs. So, I’ll try to share my thoughts on it.
First off, I’ve said it before, and I make no apologies for saying it again, the “KR” (key result) should be quantifiable. If there is no measure (or KPI) in place yet, then perhaps your first KR should be to create on. Doing so will establish a baseline from which you can measure progress.
Otherwise, there’s no real way of knowing if you’ve achieved what you need to achieve. Then where’s the motivation to do more, or the education on how to get there?
Right, now the “O.” I always encourage clients to set objectives that focus on growth. This could be for the business, the team or the individual (and there’s no reason why all three can’t be achieved in one hit).
If your objective isn’t focused on growth, then why is it in your focus? Ok, I agree there are some key “health” metrics you should track, such as those around cashflow. However, if your average aged debtor days are pretty low, then just keep this on your key metrics dashboard to make sure it doesn’t creep up. If it does, then sure, build an OKR to get it back down.
For an OKR to be growth-focused, check it meets one of these challenges:
- To do something new
- To do something differently
- To do significantly more than has been done before
New represents growth, in that it will lead to enhanced skills, capacity or capability which can all be used to increase revenue.
Differently represents growth for much the same reasons as new, but it’s more about building on what you already have. Both represent innovation, which is the lifeblood of even the most transactional of businesses (taxis and Uber anyone?) Both also carry the risk of it not going to plan, but there’s still huge value in that as a learning experience. Ever heard of the term “fail fast” – that’s about experimenting and not expecting to hit the mark every time. Instead, you should always aim to reflect, refine and readapt, which increases your chances of success the next round.
More represents precisely that, more than before. More of the same is NOT a good OKR, that’s just the day job.
If you run your OKRs by these measures, I’m confident you’ll be aiming in the right direction. As a surgeon has his scalpel to hand for making a precise cut, you have OKRs to help you focus your precious time and resources by prioritising on what will strengthen and grow your business.
OKRs represent a performance management methodology which connects the work of individual employees to your company’s overall strategy. Looking to learn more? Read our blog ‘What are OKRS and how can they help my business?’